Rising Minimum Wage Prompts Jack In The Box Fast-Food Chain To Reconsider Self-Service Kiosks

Labor costs may result in more utilization of robot technology.

self ordering kiosks a possibility at Jack in the Box
David F. Smith / AP Images

Labor costs may result in more utilization of robot technology.

As the minimum hourly wage increases across the country, something new may be popping up at Jack in the Box restaurants: self-service ordering kiosks.

Some 20 states and 18 cities are boosting the minimum wage this year. The federal minimum wage for hourly workers remains at $7.25, but the law permits states and localities to supersize, as it were, the minimum wage in their jurisdictions.

California lawmakers incrementally hiked the state’s minimum wage to $11 in 2018 as it works its way toward $15 in the coming years. With that in mind, San Diego-headquartered Jack in the Box, which operates most of its eateries on the West Coast, is apparently taking another look at kiosks, according to the company’s chief executive officer.

The corporation previously contemplated touch-screen ordering, he suggested at a recent investment conference, but declined to move forward after a cost-benefit analysis, Business Insider reported.

“‘As we see the rising costs of labor, it just makes sense’ to consider adding new automated technology, CEO Leonard Comma said…at the ICR Conference. Jack in the Box previously tested technology such as kiosks. According to Comma, the kiosks resulted in a higher average check and helped with efficiency. But at the time Comma said the cost of installing the kiosks wasn’t worth it. But with minimum wages increasing, Jack in the Box is reconsidering the use of kiosks and other technology, Comma said.”

Jack in the Box is one of many fast-food or fast-casual restaurants exploring such labor-saving technology to enhance the bottom line. McDonald’s previously announced plans to install self-service kiosks at 2,500 U.S. restaurants but insists that automation won’t replace human cashiers.

Both Wendy’s and Panera Bread are going with touchscreen kiosks at many of their outlets across the country. Panera has already enabled mobile ordering apps, as have other companies in the space, to streamline transactions. Panera has also launched home/office delivery. Last year, Wendy’s corporate president noted that some franchises raised prices to offset minimum wage hikes, Investor’s Business Daily detailed.

Former McDonald’s USA CEO Ed Renzi is on record warning that the $15 minimum wage being pushed by “Fight for $15” activists and like-minded politicians is self-defeating because it will erase thousands of entry-level fast-food jobs, which generally go to newcomers in the workforce, when small-business employers implement kiosks and other measures to reduce headcount and payroll.

Separately, the Red Robin casual dining restaurant chain has disclosed that it will eliminate busboys at nearly 600 outlets. The company claims that it will save $8 million in labor costs in 2018 alone by phasing out these positions, the Washington Examiner reported. In 2017, Red Robin got rid of the expediter role at a savings of $10 million.